Few Employers Believe HDHPs Have Been Effective for Cost-Cutting

Employers are seeking new solutions for cost control, compliance and plan administration, a study finds.

Controlling costs and keeping benefits affordable for their workforce remain employers’ top benefits priorities, but traditional approaches are proving to be less effective, causing some employers to shift strategies, according to a study by the Guardian Life Insurance Company of America.

The study report, Benefits Balancing Act, reveals less than one-third of companies believe employee cost-sharing and high deductible health plans (HDHPs) have been highly successful in achieving cost-cutting objectives. Improving workplace well-being is a priority. Employers are enhancing and promoting wellness and prevention programs, including resources to support workforce mental and emotional health, and offering more effective benefits communication and employee financial education.

Six in 10 employers feel overwhelmed with the increased complexity of managing their benefits programs.  Larger firms (100 or more employees) are struggling the most (69%), especially with installing new coverages, changing carriers, and employee communication and enrollment. The trend toward benefits administration outsourcing continues to accelerate as companies struggle to effectively manage their employee benefits programs. Having external options is crucial, especially among small businesses, where one in three report having no dedicated in-house resources to manage their benefits programs, Guardian says.

The study also found increasing benefits administration efficiency is a priority, especially to strengthen employee enrollment in health benefits and electronic data interchange.

Compliance is the number one benefits-related concern for more than one in four employers surveyed, yet less than one-third indicate that their companies are well-prepared to address it. Seven in 10 believe their firms are unable to keep up with changes to federal, state or local laws, including the Affordable Care Act (ACA), paid parental leave laws, the Family and Medical Leave Act and the Americans with Disabilities Act. Employers are utilizing external advice and technology solutions to remain current on ACA requirements and FMLA and ADA federal and state laws.